The chart above plots the total number of known Surface RT 1 units that connected to MarkedUp’s services over the course of the past year.

As you can see, the Surface RT 1 had sluggish adoption in early 2013 but rapidly accelerated beginning in March / April – the likely cause of that growth is due to Microsoft’s introduction of the Surface RT tablet into new markets and additional promotions /exposure described earlier.

However, the Surface RT’s growth really exploded around the June / July 2013 timeframe – right when the Surface’s prices slashed. Bear in mind that late Summer and Winter are Microsoft’s two strongest sales quarters for consumer products – “Back to School” and “Holiday” sales respectively.

Average number of monthly Surface RT 1 units sold prior to price drop

105,452 monthly units

Average number of monthly Surface RT 1 units sold after to price drop

358,044 monthly units

As you can see from the data table above, the monthly sales volume of Microsoft’s Surface RT 1 units tripled following the price cut – moving from roughly 100,000 units per month to 350,000 per month.

We plotted the net number of new devices per month to help confirm this:

You can see a big ramp up of sales in July and August, followed by a drop in September. That’s natural – back to school sales typically end by Labor Day in early September, so there’s going to be a big drop following August.

But what’s really telling about this graph is that the number of units sold in September is still greater than what was sold in July (another strong B2S sales month), which is unusual. Here’s the raw data table to supplement the chart.

Surface RT 1 Worldwide Adoption January 2013-2014

Month

New Devices

Total Devices

2013-01

75,535

75,535

2013-02

72,701

148,236

2013-03

83,678

231,914

2013-04

96,134

328,048

2013-05

120,522

448,570

2013-06

184,140

632,710

2013-07

246,299

879,009

2013-08

339,794

1,218,803

2013-09

249,798

1,468,601

2013-10

318,291

1,786,892

2013-11

321,131

2,108,023

2013-12

556,965

2,664,988

2014-01

474,030

3,139,018

It was generally believed that issues with the Windows 8 and Surface RT user experience were the tablet’s primary barriers to adoption. It is our conclusion that the real issues might have been awareness and price sensitivity.

So why is the Surface product line starting to look healthier for Microsoft now? Is the Surface 2 or Surface Pro such a drastic improvement over the Surface RT tablets that it’s been able to single-handedly double Microsoft’s Surface revenue? Not exactly.

By the end of December 2013, we started seeing roughly 60,000 new Surface RT 2 devices activated per month – a pretty good start for a new device that’s still trying to build up brand recognition with consumers.

However, its older cousin, the Surface RT 1, sold well over 500,000 copies in December.

Surface RT 1 vs. Surface RT 2 Devices Activated per Month

Month

Surface RT 1

Surface RT 2

2013-01

75,535

0

2013-02

72,701

0

2013-03

83,678

0

2013-04

96,134

0

2013-05

120,522

0

2013-06

184,140

0

2013-07

246,299

0

2013-08

339,794

131

2013-09

249,798

130

2013-10

318,291

10,315

2013-11

321,131

34,476

2013-12

556,965

62,905

2014-01

474,030

61,340

Total

3,139,018

169,299

Conclusion

It’s difficult to reconcile this data with the theory that the Surface RT 1’s inability to meet Microsoft’s original sales estimate was due to the product design itself, if you assume that the Surface RT 2 is an improved product (which it is.)

Aside from the innate improvements made to the Surface 2 and its novelty, the only other major difference between the two generations of Surface is price. Microsoft moves many times more tablets when the starting price point is at $349 versus $499.

In a subsequent update, we will perform a similar analysis for the higher-end Surface Pro and Surface Pro 2 tablets.

MarkedUp’s Collection Methods

Our data is collected from apps that are installed directly onto end-user machines, so our data set is limited to “devices that have installed an app that uses MarkedUp.”

That being said, this data set is covers roughly 10% of all Windows 8 machines ever sold. Our numbers for Windows Phone are similarly impressive, but excluded from this data-set (naturally.)

There is some latency between when a device is sold to an end-user and when we “discover” it by way of an app installation; however, having been in market since before Windows 8 was launched, our data set has historically mirrored the market as it moves in real-time. We see giant surges on Christmas morning, after Black Friday, and so forth.

Devices can be counted multiple times, depending on the number of installed apps from distinct MarkedUp-enabled publishers and the version of our SDK that was used. Our facts and figures accurately reflect trends and changes in direction in the market, but not precise figures.

These reports are anonymized aggregations of our entire data-set.

The data in this report tracks the number of net new devices activated on our platform per month, starting from January 2013 to January 2014.

We made MarkedUp Analytics privately available to some Windows 8 developers in September, and thus we’ve had a chance to watch the Windows 8 ecosystem grow since well prior to its official 10/26 launch.

However, what about the Surface RT tablet Microsoft released on the same day? How well has it sold since?

MarkedUp Analytics was installed into some of the biggest apps in the Windows Store a month prior to the launch of Microsoft Surface; that puts us in a good position to use our data to make some educated inferences as to how well the Surface has really fared in the device marketplace.

Surface and the Windows 8 OEM Landscape

Before we jump into the specifics of Microsoft Surface, let’s consider the Windows 8 OEM ecosystem.

OEMs like HP, Dell, and Samsung still have a significant presence in the Windows 8 market, and the majority of it from devices that have been upgraded from Windows 7 and XP.

These traditional PC manufacturers also had a small, but statistically significant head-start over Microsoft in terms of total market share, because developers and big enterprises have had early access to the full verison Windows 8 since 8/15.

This chart represents total market share by OEM across all devices that have used an app with MarkedUp installed in it since 10/26 until 11/24/2012, spanning roughly one month since Windows 8 and Microsoft Surface officially launched.

According to our data set, Microsoft has only one device in market – the Surface RT tablet. Our data set showed that Microsoft had statistically 0.0% market share prior to 10/26*, the day Surface and Windows 8 officially went on sale.

Microsoft’s 7.77% market share on this chart is represented solely by the adoption of the Surface RT tablet, and making Microsoft the 4th most popular OEM among Windows 8 users currently.

This number is also reflected in our analysis across all Windows 8 device models, rather than manufacturers:

MarkedUp has observed 11,385 distinct Windows 8 device models as of 11/24, and most of them are upgraded Windows 7 / Windows XP devices.

Microsoft Surface is by far the single most-used Windows 8 device from this cornucopia of hardware, occupying roughly 7.76% of the market.

The next most-used device model is the Samsung Sens Series laptop, like the Series 9 ultrathin notebook, with 3.31% market share, less than half of what the Surface RT has.

So with all of this market share data in mind, what’s the adoption rate for Microsoft Surface thus far?

Microsoft Surface Adoption Rate

So how quickly has the Surface RT tablet been adopted worldwide?

Well, we don’t have the absolute numbers since MarkedUp doesn’t have 100% market penetration across every unique Windows 8 device (working on it!) but we do have more than enough data to draw some inferences about the rate as which Surface RT tablets are being adopted.

The following chart shows the cumulative growth of the Surface RT’s installation base:

As we mention in the callout on this chart, we decided that the best way to plot the growth of the Surface was to create an index and plot all of the cumulative growth relative to the index.

We set the index value 1 to be equal to the number of Surface RT tablets we saw activated on 10/26, the day it first went on sale. The final value on this chart has an index value of 120 for 11/24/2012, 29 days after the Surface went on sale initially – meaning that there were 120 times as many Surfaces activated by 11/24 than there were on 10/26.

So if Microsoft sold 10,000 Surfaces on day 1, then by the rate of growth on this chart they will have sold at least 1,200,000 units by 11/24.

Remember, this chart shows active devices that are being used and have consumed apps from the Windows Store, not devices that have been sold. The numbers on MarkedUp’s charts are effectively a floor for sales given that devices are sold before they’re used.

Microsoft Surface Adoption by Country

So we’ve shown you how quickly Surface RT tablets are being activated, but what about where they’re being activated?

In the chart above we broke out the percentage of Surface RT distribution by country including the 10 largest markets; the subsequent 60 markets all trail off quickly.

The United States has an overwhelming 68.52% share of all Surface RT tablets activated thus far with the UK coming in at a distant second with 9.10% share.

Our numbers across all Windows 8 devices are slightly different, but the US and UK both have dominate leads in those figures too.

One factor that may skew MarkedUp’s numbers towards the English-speaking world is that many app publishers forgo full international distribution in the Windows Store due to the fact that many parts of the world, including China and countries that have tighter content restriction laws, lengthen the Windows Store approval process and can even cause the app to be rejected outright.

So on that note, we strongly suspect that China in particular is under-represented on this chart given that it’s a massive market, but one that is more difficult for many app publishers to reach due to content restrictions.

Conclusions

Based on the data above, here is what we conclude:

The Microsoft Surface is the most heavily used ARM device in market for Windows 8 by a wide margin thus far and it is the single most-used device overall for Windows 8;

Surface’s growth appears to be strong, but it’s difficult to extrapolate the absolute number of units have been sold without knowing what the total day 1 sales were;

Surface RT is being adopted in primarily English-speaking countries, but has broad international reach; and

The majority of devices in market for Windows 8 are upgrades from previous versions of Windows, not new devices that came with Windows 8 installed; we’ll see how this changes as we collect more data from the Holiday season. The fact that the Samsung Sens Series made a strong appearance on our device model breakout shows signs of a growing ecosystem of net new Windows 8 machines from non-Microsoft OEMs.

Appendix

Here are some other interesting statistics from our OEM data set:

The remaining 24.48% OEM market share not shown on the OEM chart represents 296 long-tail, smaller OEMs including VMWare virtual machines and a number of motherboard manufacturers used in home-made PCs.

x64, 64-bit Intel hardware, is used by roughly 70% of the daily active usersfor the entire Windows 8 ecosystem every day;

x86, 32-bit Intel hardware, is used by roughly 20%; and

ARM, the new architecture for lightweight tablets like the Surface, is used by the remaining 10% of daily active users.

*MarkedUp observed some Microsoft Surface RT devices appear as early as 10/18 in our data set, but not enough to be statistically significant. We suspect that they were preview devices given to select app partners, press, and others with early access.

This week I’m attending //BUILD conference in Redmond, WA on Microsoft’s main campus alongside thousands of other .NET / Windows developers. The keynote ended about an hour ago and I wanted to publish my thoughts on some of the important takeaways from Ballmer’s talk.

Microsoft’s Points of Emphasis

1. “Microsoft can only win by training consumers to expect consistent behavior, availability, and synchronized data across all of their different devices”

WinRT isn’t just about tablets – it’s also about fundamentally changing the way desktop software is consumed and unifying mobile / desktop / tablet and probably console apps all under one consolidated platform.

The unification of these platforms is the future of Microsoft; training consumers to expect consistent behavior and access to data across all of their devices is the only way Microsoft will be able to dethrone Apple and Google in mobile / tablet and protect themselves in desktop / console in the long-run.

Ultimately, Microsoft is really the only company that can execute well on native software, services, and devices. They are playing to their strengths (ecosystem and platform) and are doing it well here.

2. “The fate of WinRT is in the hands of developers big and small.”

Microsoft desperately needs developers to make WinRT a success.

Microsoft, for the first time since Win32 emerged as the victor in the desktop wars of old, is in a position where it needs developers more than they need Microsoft.

The unified vision behind WinRT will not work without the buy-in of developers both big and small, from Facebook to the individual hobbyist developer.

Microsoft will do the hard work of putting devices in the hands of consumers that bring WinRT applications to the forefront (which I suspect is the real reason why the ARM-only Surface shipped so far ahead of the Intel one.) But it is totally reliant on developers to put the content in-store that consumers actually want to use.

3. “Microsoft and Nokia will work themselves to death to win the support of developers.”

Compounding key takeaway #2, Microsoft and Nokia both made commitments to put hardware (Nokia phones, Surfaces for us //BUILD attendees) into the hands of developers who build apps.

Having worked at Microsoft Developer Platform Evangelism throughout the entire WP7 push, I can tell you that this is no joke – Microsoft will find a way to arm its developers with hardware now that it’s all generally available.

But they’re not stopping there – Microsoft is going to continue to push training events, hackathons, webcasts, and everything it can possibly do to train developers and make it easier than ever to learn a new platform and actually ship an app on it.

I think this is tremendously positive and every developer who’s interested in the platform will have multiple opportunities to learn it on Microsoft’s dime.

4. “Don’t ship apps that don’t leverage the platform.”

Reading between the lines in some of the keynote speeches and the first couple of sessions I poked my nose in, you can interpret the following from Microsoft:

Developers who carbon copy their work byte-by-byte from previous platforms, including web apps, are doing themselves a disservice and will have their lunch eaten by developers who take advantage of charms, live tiles, and all of the other unique built-in features to Windows 8. Please take advantage of the platform if you’re going to build an app for it!

Here’s why: the success of Microsoft’s entire consumer software ecosystem rides on consumers adopting the Metro UI and getting used to the rest of Microsoft’s services ecosystem, which includes your apps in the Windows Store.

However, without a significant presence in mobile, Microsoft and Windows will always have the threat of a unified iOS / OS X ecosystem there to sweep the desktop market out from underneath it. Windows Phone 8 is not a side show – it’s part of the core front Microsoft is forming against Apple on consumer computing.

Parting Thoughts

This is a really exciting time to be a Windows developer. The opportunities for developers to build sustainable businesses around Windows 8 and Windows Phone 8 apps are huge and there for the taking.

On top of that, the ecosystem has never been more accessible – you can build native apps for Windows 8 and Windows Phone 8 with C# or C++, and I suspect we’ll eventually see WinJS apps make their way onto Windows Phone 8 too.

That’s why our team at MarkedUp is excited to be doing what we’re doing

We’re going to update the statistics daily and help developers track how quickly Windows 8 is picked up by the community at large, using our entire data set.

Sampling Methodology

Our methodology for sampling the data displayed in the charts is straightforward: we take a seven day rolling average of all active users and new installations detected from an app and calculate rate of change between them.

There are some other things we do to try to prevent outliers from spiking the graph (i.e. apps that acquire a large number of users rapidly, usually popular titles ported from other platforms) but generally it’s all just rate of changes against a moving average of new devices activated and daily active users.

You’ll notice a big surge on the 19th – that’s due to a trend that started on the 15th of October where the Windows Store approved nearly 20% of the current apps that are in market now (roughly 5000 apps in market,) which subsequently lead to a big surge in our numbers.

If the Windows Store goes through another sustained round of high-volume approvals that will similarly spike our numbers again.

We’re working on refining our methodology for the “Windows 8 by chipset architecture” graph at the bottom since we expect it to change radically with the availability of new ARM devices.